Rural poverty refers to poverty found in rural areas and relates to nearly 63 percent of the world's population. It reaches a 90 percent share in China and Bangladesh and between 65 percent and 90 percent in sub-Saharan Africa. In almost all countries the rural poor, in contrast to the urban poor, face far worse conditions in terms of personal consumption, access to education, health care, portable water and sanitation, housing, transport and communications.
The rural poor depend largely on agriculture, fishing and forestry and related small scale industries and services. They rarely choose or control the conditions under which they earn their livelihoods. The rural poor can be classified into two groups according to whether they have access to agricultural land. This category is known as the cultivators, who have access to land as small landowners and tenants. The other group is known as the non-cultivators, who have no land and are unskilled workers.
Cultivators, who form the bulk of the rural poor in developing countries, are directly engaged in producing and managing crops and livestock. However, many poor farmers are denied access to land, water, credit, markets and other basic resources they need to survive. They are unable to compete in selling their produce in local markets because of the flood of cheap products from subsidised producers in wealthier countries. Consequently, some members of these households migrate to towns or cities on either a rotational or a long-term basis.
Non-cultivators are regarded as the poorest among the rural poor. These workers depend on seasonal demand for labor in agriculture and in rural informal, small-scale industries and services. This group is vulnerable to fluctuations in the demand for labor, wage rates and food prices. They find it even more difficult than small landowners and tenants to gain access to public infrastructure and services.
Among the highly diversified poor rural communities, researchers have observed that women as a group stand out. Their poverty and low social status in most societies is one of the most important reasons for chronic poverty. The majority of women falling into the category of the rural poor remain economically and politically marginalised, although their contributions to the resilience of rural households and their potential as agents of change has been acknowledged.
All groups of the rural poor are vulnerable to serious risks owing to changes in weather, health, markets, investment and public policy. The resulting fluctuations in the prices and quantities of their assets and of what they produce can either deepen their poverty or give them opportunities to escape from it. Economic crises and natural disasters can bring about sharp increases in poverty and make it more difficult for the poor to improve their lives.
According to Jazairy et al (1992) and Gaiha (1993), a number of characteristics of a country's economy and society, as well as some external influences, create and perpetuate rural poverty. These factors include: political instability and civil strife; corrupt politicians and rent-seeking public bureaucracies; economic policies that discriminate against or exclude the rural poor from the development process and accentuate the effects of other poverty-creating processes and ill-defined property rights or unfair enforcement of rights to agricultural land.
Other factors affecting the rural poor include: Systemic discrimination on the basis of gender, race, ethnicity, religion, or caste; a high concentration of land ownership and asymmetrical tenancy arrangements; market imperfections owing to the high concentration of land and other assets and public policies; large and rapidly growing families with high dependency ratios; and external shocks stemming from natural causes such as climatic changes, in addition to changes in the international economy.
Policies aimed at reducing rural poverty focus on four major groups. This includes small landowners who cultivate their land; landless tenants who cultivate other people's land; landless laborers who depend on casual or long-term employment in the farm or non-farm sectors; and women, who could also be part of any of the three preceding groups. All of these groups will benefit from good macroeconomic management, which helps keep inflation in check. Macroeconomic stability, competitive markets and public investment in physical and social infrastructure are widely recognized as important requirements for achieving sustained economic growth and a reduction in rural poverty.